February 5, 2014

Host: Ted Simons

Farm Bill

The U.S Senate passed a new farm bill. The Agricultural Act of 2014 will provide farmers and ranchers certainty for the coming year. Arizona Farm Bureau president Kevin Rogers will talk about what the bill means to Arizona farmers.

Ted Simons: U.S. Senate passed a new Fife-year farm bill yesterday. Earlier approval by the house means the bill is on President Obama's desk. Arizona Farm Bureau president Kevin Rogers is here to talk about what the bill means to the farmers here in the state. Thanks for coming.

Kevin Rogers: Appreciate the opportunity.

Ted Simons: New five year farm bill, after a whole lot of fussing and fighting they finally got something done. Your thoughts.

Kevin Rogers: It's about time. One of few things Congress has to do every five or six years is pass a farm bill. For USDA, farmers and ranchers and for the citizens of this country. We have to be feed. We have to grow the food, make sure it's safe, nutrition, affordable. This tells us what the next five years are going to hold as far as what the government is going to do.

Ted Simons: I was going to say, that certainty for farmers is pretty important.

Kevin Rogers: It is. As we negotiate with our lenders, we're business just like anyone else, we go to our banks every couple years and say this is what I hope to produce; this is what I hope to sell it for, lend me the money. If that negotiation, we need to understand there's insurance programs, target prices, what's there if the worst case scenario happens and we run out of water or in the Midwest they don't get rain or the drought. Whatever happens we need to understand what's at play.

Ted Simons: So the agriculture act of 2014, what does this farm bill do?

Kevin Rogers: Well, it's obviously just been passed by the Senate. Hopefully the president is supposed sign it tomorrow or Friday. We're getting pieces of it as it comes out because things change all the time. It gives us stability in the future for the next five years. It tells us that livestock disaster has money set aside if you think back to this late fall we had those cattle up in the Dakotas that froze in place and ranchers lost hundreds of thousands of dollars. They have been out on their own without any support. At least now we understand that there's disaster money there for different things that could happen across this country. Really the food nutrition is a big part of the farm bill, 75%, more of a food bill than a farm bill. The agriculture part of this is only about to 12-15% depending on what you classify as production AG. A lot of money for research, a lot of money for grants, for technology. Out in the west we grow good crops in this soil. Everything is irrigated, so we don't have the seasonal risk that they may have in the Midwest but we rely on technology heavily.

Ted Simons: Talk about those risks. There's criticism regarding the subsidies. Now it kicks in when the farmers suffer losses. Is it more of an insurance plan?

Kevin Rogers: This new bill is moving towards and insurance plan. That's one of the changes that's come about. Really, we're pleased that Congress has acted on anything. When you think about what they do back there and what they are supposed to do we're tickled there's a bipartisan vote and now hopefully they can do other things that are important to us. But when there's a need, when there's a short time, that's when that safety net should kick in and it's important we be able to feed our country. I would hate to think I'm relying on Hugo Chavez or someone around the world to feed us or send us food. It tells the citizens of this country we'll be able to feed ourselves. We'll be able to grow crops here. If the worst skies scenario happens and we have a disaster there will be funds to keep the farmers in business, not to make a profit, just to pay the bills and live to fight another day.

Ted Simons: Some critics thought the spending was too high or possibly too high. They call a bait and switch situation because the costs will escalate. Bad weather, falling markets. The costs could escalate more than perceived right now. Is that a real threat?

Kevin Rogers: Well, there's always the unknown. However, you write a farm bill for the worst case scenario. When we go to Capitol Hill we talk about the worst case. What if I total the car, do I have coverage? That's pretty much the game plan going in. I don't see an opportunity for it to go much worse than it is. In fact every year we have always given money back to the federal government as far as U.S.D.A. They get appropriated so many dollars at the end of the year. If you don't have those disasters, if the cotton price is up, milk stays where it's supposed to be, the U.S.D.A. has the money to returns back and we don't talk about it that much.

Ted Simons: Sounds like there's more in this bill that will save money over the years.

Kevin Rogers: As we move away from direct payments to an insurance based program in Arizona we grow a lot of cotton. As we figure out what insurance product is there for some of the commodities we grow including our vegetable folks that have never been in that cycle now there's an opportunity for a product to be developed for our vegetable folks, we'll learn more about that, but much like you buy insurance for your cars and your homes, it's there for worst case scenario and the government helps fund part of that but then the farmer can buy up that premium if he feels he needs more than the base amount.

Ted Simons: There's been a lot of fussing and fighting over this and it's taken a long time to hammer out this compromise. A lot of folks are not happy with it which probably means it's a good compromise.

Kevin Rogers: We have some people that have never been happy with the farm bill, some of our friends, Mr. Flake, Mr. McCain, they don't support the expenditure, having those dollars there for a rainy day fund. We have to feed this country. Every day we go to the grocery store you want to make sure there's food on the shelves to purchase.

Ted Simons: Senator McCain called it a monstrosity. That's his word. Too many subsidies for farmers, too much duplication in terms of subsidies and nutrition programs. Does he have a point?

Kevin Rogers: They cut the nutrition package almost $10 billion from where it was and where it has been. When you look at the Senate version it was eight to 10 billion. The house wanted to cut 40 billion. They ended up with eight, where the Senate was. Obviously Mr. McCain was in the minority of that. It takes a long time to clean up what you're doing. Most of the savings is based on making sure that people qualify for those things, things you and I take for granted that we expect folks to do don't always happen. So qualifications of those funds are watched very closely.

Ted Simons: As far as Arizona farmers are concerned the farm bill in general, just in particular, conditions out there. We're in a drought. We have water concerns. What's going on with the farming community?

Kevin Rogers: Everyone's looking to see what the future holds. We need rain. We need snowpack this winter. We desperately need the reservoirs to get some water. The Salt River Project needs to be filled; the Colorado River System needs to come up. Agriculture is some of the first to get cut in a drought. The drought is probably number one on our radar along with forest health. That's our watershed that has to hold the water for us. If it's burned off and not taken care of correctly that becomes an issue too.

Ted Simons: This is my last question, quickly, the farm bill, food stamps are a huge part of the farm bill and obviously you're a farmer and you have your concerns. Does the fact that perhaps fewer people will get food stamps, does that concern you as a producer?

Kevin Rogers: Well, it comes back to need. Those who need it should be able to get it and qualify for it and part of what we do is make sure the gleaning programs in this valley across the state are tremendous, conservation that happens in agriculture is tremendous. Yuma is the lettuce capital of the world. People are harvesting it and giving it to food shelters. You hate to see people go hungry, so we expect our government leaders to make sure those who need to be fed get fed.

Ted Simons: Kevin, good to have you here.

Kevin Rogers: Thanks so much. Appreciate it.

Ted Simons: The new year finds Arizona hospitals facing a number of new issues, including the affordable care act and a hospital price transparency law. Joining us now is Greg Vigdor, president and CEO of the Arizona Hospital and Healthcare Association. Good to have you here.